EU Boosts Sanctions on Deficit Violators

By

Patrick McGroarty And

Matthew Dalton

Updated Oct. 19, 2010 12:01 a.m. ET

LUXEMBOURG—European Union governments reached a deal Monday to tighten rules governing the bloc's public finances, handing more power to the European Commission, the EU's executive arm, to act against countries that violate debt and deficit limits.

EU finance ministers, sitting on a group led by EU President Herman Van Rompuy, told reporters after meetings here that the task force would also consider recommending changes to the EU's governing treaties to forge even tougher penalties and to provide for an insolvency of a...